Costco Docklands store.

Costco is creating more competition in Melbourne. Photo: Michael Clayton-Jones

Melbourne will emerge as the jewel in the crown of US discount supermarket giant Costco’s aggressive expansion in Australia with a fourth warehouse now planned for the city, to be situated at Moorabbin Airport in Melbourne’s south east.

It will complement Costco’s maiden store in Australia, erected in the Docklands in 2009, and its recently opened store in Ringwood situated deep in the city’s eastern suburbs. Plans for a Costco store in Epping were approved by Whittlesea Council just before Christmas.

The massive scale up will place further competitive pressure on leading supermarket giants Woolworths and Coles, especially in Victoria, as Costco’s US management tag Australia as a major source of growth for the global company.

Melbourne is already one of Costco’s strongest markets in Australia with more than 100,000 members who have paid $60 per year to gain access to its store where they can buy clothing, homewares, electronics and a range of other groceries in bulk or at highly competitive prices.

Last month, BusinessDay revealed US-based Costco had wired $110 million to its Australian operation to fuel its ambitious expansion plans in the region.

Documents lodged with Moorabbin Airport reveal Costco will build its next discount warehouse store on the airport land, representing a $35 million investment that the Moorabbin Airport Corporation believes will generate roughly 810 direct and indirect new jobs adding to the existing 3,300 airport area jobs.

Once completed, it will be Costco’s fourth site in Melbourne, against two in Sydney, one in Canberra and two others currently planned or under construction in Brisbane and Adelaide.

Moorabbin Airport, situated on Commonwealth land, is serviced by key road networks including the Nepean Highway and the new Peninsula link.

The fact the site is on Commonwealth land could help its planning approval be fast tracked as Commonwealth land typically has an accelerated planning process and less onerous conditions.

When discounter Direct Factory Outlets (DFO) began rolling out its warehouse stores 10 years ago it often chose to build them on airport or Commonwealth land as it placed less controls, or more flexible controls, on their construction plans – much to the anger of nearby shopping centres situated on council land that had higher hurdles to clear for its own planning requirements.

The Moorabbin Airport Corporation is currently preparing an application for a Major Development Plan for a Costco store on its land, which will include reports on issues such as traffic, environment, economic analysis, social impact and its existing aviation operations. There will also be a period of public consultation.

It is unclear if the Costco planned for Moorabbin Airport will also include a petrol station. Costco in the US offers cheap fuel to its members with Costco keen to also sell cheap petrol here.